Ty Roney is on the show today and here to share a very interesting perspective. In addition to being a private label seller himself, Ty Roney runs an agency focused on helping ecommerce business owners with the Amazon side of their business.

At the time of recording Ty works with about 50 sellers on Amazon and does full service management for some clients and PPC focused management for others. Because Ty is working with so many sellers on Amazon he has a unique perspective on what you can do to help grow your business. Listen in and I'm sure you'll love this episode.

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Get involved and ask a question about selling on Amazon and Chris may answer your question live on a future episode of Sellercast. Also, if you think you'd be a good guest for the Sellercast podcast feel free to tell us more about you and your company here.

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Show Notes and Links

Podcast Transcript

Intro: Hello, Chris Guthrie here, host of Sellercast. And in today’s episode, I have Ty Roney on. I’m really excited about this episode because Ty works with a lot of Amazon clients, and so he has the perspective of someone who’s working with 50+ different businesses. So he has a bird’s eye view of a lot of what we’re seeing going on in this space. And we get into that throughout this show. So, let’s start the recording and I hope you enjoy this episode.

Chris Guthrie: I’m really excited to talk about you because you have a unique background and a unique insight into this business that a lot of people don’t have.

Most people are just selling their own products on Amazon, and they only have access with their own data. Whereas you work with a lot of different sellers, and so you get a high level overview of what a lot of people are doing across Amazon in general.

Is that a good way to sum it up?

Ty Roney: Yeah! Yeah, sure. I think that’s perfect.

Chris Guthrie: Okay, cool! So that’s what we have in store for this episode. But I’d like to get back into how you got into this briefly. And then we can talk about what you’ve been doing today where you’re working with clients and talk about that as well.

Ty Roney: Sure, yeah, kind of a quick progression of things. Probably over five or six years ago or so, I was managing a toy store actually. It was just a brick-and-mortar retail location. I talked to my boss and said, “Hey, I heard Amazon’s a good way to make some money. I’d like to propose that we cut my salary in half and give me a portion of the upside on Amazon.” They weren’t interested in that, so I left the store and did it on my own.

I started off several years ago as a reseller in the toy world because I was really familiar there. I grew revenue really fast. It was awesome. I did a bunch of traveling because I could do a lot of stuff with my laptop.

And then, even though revenue was great, margins just keep getting thinner and thinner over time in that industry. I realized I wasn’t as excited about being just a reseller. So, I actually sold my half of the business.

I did this with a partner. I sold my half to a new partner. And then, decided to start making my own products and launching those. And so I did that. That’s been a lot of fun. I had a lot of success there.

And then, just about a year ago, I teamed up with some local entrepreneurs here to form an agency. And that agency is based on helping other people, brands and companies sell and market their products on Amazon and manage their whole experience for them.

Chris Guthrie: That’s great. So, you were able to sell out of that previous business which I’m assuming gave you enough startup capital to buy some inventory and start launching some products on the private label side. And then, you used that experience to then help out on the agency side as well. So, that’s great.

Ty Roney: Yeah! Yeah, that’s actually exactly what I did. I took every penny that I made and put it all into inventory. I bought way too much, to begin with, of my own product. And then, I luckily I ended up selling through it within six months.

I literally bought I think 6000 units for whatever reason. But it ended up working out. I’d never do that again, but it actually ended up working out for my benefit.

Chris Guthrie: Yeah, that can be a common mistake when people first get into the private label space. But it’s great that you’re able to still sell it out and not get hit with any long-term storage fees and stuff like that. So, that’s great.

The other part I wanted to ask you about was this aspect of working with a lot of different sellers. I’m thinking I’d like to talk just kind of high level of some of the different trends you might be seeing in this space. And then, we can maybe narrow down some specific topics that might be relevant to people.

Are you able to say, for example, roughly how many clients you’re working with right now?

Ty Roney: Yeah, yeah. We have just, I’d say, around 45 clients under our full management service. And then we just launched an Amazon PPC or sponsored products-specific service just about a month ago. We have 20 beta users there. We’re going to open that up in the next couple of weeks.

So, we have basically 60 clients in total that we work with.

Chris Guthrie: Wow! That’s cool. That’s great. And I’ll mention at the end of the show notes here a link where you guys can go to check that out if you’re interested.

So, you’ve got access to working with all these different clients, a lot of people selling in various different categories. Are there anything that you see as we’re heading into 2016—I guess we’re already pretty well into 2016 now—as we’re in this year that have changed over the previous year in terms of strategies that used to help have with clients that were working or stuff that’s not working as well? Anything like that would be interesting.

Ty Roney: Yeah. Let me think. So, we work with a variety of different types of sellers. We have everyone from the private label seller that just has one product that wants help, wants us to do it all for them from the beginning. Then we have some actual decent-sized brands and companies.

And so, I guess just as far as the last year goes, one obvious thing is just the level of competition has increased. That’s very straightforward.

I think especially on the advertising side, we’re going to continue to see that getting more expensive right as people realized just how—in certain categories and certain products, you can still have an amazing return on your ad spend. I think as soon as people really start to catch on—

Like in the supplement, for example, a lot of those, you’re spending a pretty penny to get the bid. There are still plenty of categories and different opportunities where it’s not quite as competitive. But overall, it’s definitely trending that way for sure.

I think that the grocery category is a really interesting one that I’m definitely going to keep an eye on. I think that’s a category that not necessarily a lot of private people get into, but will be growing pretty significantly hopefully with the way that consumers are spending and what-not. I think the grocery category is one that is poised to grow pretty substantially in the next few years.

But yeah, I’m trying to think of if there’s anything else. Anything more specific you might be thinking of?

Chris Guthrie: Yeah! Well, I mean, the fact that you mentioned the supplement space, I think that by now, if people, especially if they’re already selling in Amazon, you’re aware that that’s a super competitive area. And I think that’s almost a matter of if you look at what those sellers are doing and trying to reverse engineering how they’re having success, maybe looking at where they’re getting their revenues, if they’re driving traffic from exterior or from other external sources, all those different kinds of things can give you insight in terms of what you can apply to doing your own business.

I mean, if you’re already selling in the supplement space, and you’re not doing that, then that’s a good one. But it gives you a sense of what can be done in that way. So, that’s cool!

And then, on the grocery side, that’s interesting. So, you think people are going to be doing their own co-packer and get their own food-based products done basically?

Ty Roney: Yeah. I just happen to work with—we have a few grocery clients, and they’re doing okay. Some are actually doing quite well. I mean, there might be an opportunity there, right?

It’s definitely more technical. You need to make sure it’s something that people are eating or drinking. And so that’s something that there’s obviously a lot more precautions you’re going to want to take.

So, yeah, that’s one thought. I guess another thought I had too is just the idea that a lot of our most successful clients, they have a brand and they have a line of products. So, they’re building out more of a presence beyond just one single product.

And for us as an agency, we look at things and say, “Okay, how can we make this brand successful?”

I’m always more excited to work with a brand that has maybe a dozen SKUs or six or whatever, more than one, just because it increases probability. If you have 10 or a hundred products, as long as those laws hold true, then there’s going to be a few that are going to do really great. There’s always going to be a couple that are dogs. It just always happens. And then, there’s a few that are in the middle.

I think that’s a really great way to try and approach it’s, obviously, not necessarily an easy way to start. But over time, if you can really have a brand that has several SKUs, it’s a really great way to go and build your presence on there.

Chris Guthrie: Yeah, actually. I think that the general trend makes sense. A lot of people have more SKUs. We have an episode—if people want to listen to it, it’s Sellercast.com/15—with Jo Barnes where she had a 6-figure per month Amazon business with only one product. But I think that’s probably an exception rather than the norm in terms of the people I’ve been talking to. But yeah, it makes sense to try and launch multiple products as opposed to being a one-product company.

So then, on the launching site, what are your clients doing? What are you advising them to do in terms of when they launch their products? Is there anything different in terms of what you’re seeing there?

Ty Roney: I imagine our process is somewhat similar to what everyone’s learning across the board. The hardest thing for us when we’re working with our new clients is helping them to understand the value of really investing money in the beginning to be competitive.

And so, I think all the principles hold true. We have a whole process set in place. It’s doing really good keyword research, making sure that you have a fantastic listing with incredible images. Images, I think, are one thing that are often, “Yeah, I’ve got a good image,” but I think it’s a huge piece of catching somebody’s eye.

And then, going from there, making sure you have an awesome listing to getting it noticed. So, you’re doing everything to drive traffic to that listing, whether it’s through a giveaway, getting reviews, and running advertising to it.

But the biggest thing—that’s all pretty clearly laid out. You could listen to about maybe three or four podcasts and learn a lot of the basics. But one thing I think a lot of people missed (at least a lot of the clientele that we have that aren’t familiar with Amazon) is they expect that they can just get a listing on there, and they can just start making money sometimes.

And I like to frame it in, “I came from this brick-and-mortar retail world,” and I always look to use the analogy of it, “Think if you’re just going to build out your own brick-and-mortar store. What would you be willing to do?”

Well, you’d be willing to spend a lot of money to make sure the inside looks nice. You would make sure that your products are displayed really well. And that would cost a lot of money just to begin with.

And then, you would likely make sure that it was hopefully in a good location, and that you are doing something to tell people about it, right? So, maybe you’re going to run an ad in the newspaper or radio or whatever, any kind of social buzz. It’s so physical and it’s so clear to see that that’s what needs to be done if you’re going to do that.

So, I always try and say, “Okay, imagine how much money you’d spend.” You could easily spend six figures trying to get all that accomplished, right? But on Amazon, you can be much more effective with your cash, but you should also realize that you should be willing to invest a decent chunk of money in those first few months to really get your product up and running and not be afraid to lose money, to say, “Okay, even for three months, I’m going to lose money because I know that this is going to help me to rank and get my brand and my name out there.”

So, I suppose it’s in, really, what you’re willing to spend initially in order to get the traffic that you need and to get your product noticed. And then, on the pay-per-click side, it’s a lot about getting data. It’s a lot about getting really valuable data.

People don’t realize that if they’re really stingy with their budgets and their bids, you may not show up anywhere, number one. But number two, you’re not getting some really important data that can help you make good decisions in the future.

Chris Guthrie: Let’s dive into PPC a little bit more actually. What are some of the decisions that you could make with that data? Maybe you can elaborate a bit on that part.

Ty Roney: Sure! The cool thing about the advertising campaign data that you get is that it’s completely real. It’s hard. We all use all sorts of different pieces of software to get an estimated sales volume or to look at keywords. But the nice thing about your PPC data that you’re getting on Amazon backend is that that’s like cold, hard fact. You can look at a keyword and say, “Wow! There were 100,000 impressions for this specific keyword. I got this many clicks exactly, and I got this many sales.”

And so, number one, just looking at that, you might be able to say, “Wow! You know what? There’s a lot of demand or volume for this specific type of keyword,” which may help you to decide, “Well, is my product positioned really well for that keyword? Does this make a lot of sense?” Maybe you can make some tweaks to your listing that way.

So, that’s something that I think is really interesting. Through the keywords that are being searched, like I say, you may find some keywords that don’t even seem that related, but it’s starting to generate some sales, which might give you another idea for another product, a variation or something to add on as a bundle or an accessory or something like that. I think that’s pretty valuable.

And then, the other thing too is making some changes to your listing based off of what your PPC data is telling you. That also has to do with your sales.

Maybe, for example, you were spending a lot of money and your ACoS is still really high and you couldn't seem to get it down. But your listing seems really awesome. You feel like you have a fantastic product. Maybe try tweaking your price and dropping it by a few dollars or whatever you think you can and seeing how that affects things.

The interesting part about us, when we’re just working on PPC for the clients, we feel a little bit siloed. After a month or two, we try and give them some feedback and some advice on, “Maybe this is what you should try on your listing because that actually might help us to be more effective in our pay-per-click campaigns.”

So, I think it’s really just all about testing in the long run, and maybe making some changes, some tweaks, and then seeing how that affects all the sales data, all of your PPC data.

Chris Guthrie: Now, one of the things you mentioned in there I wanted to latch onto, just mentioning that once you have that data from running PPC, you can get a sense of, “Well, I’m getting a lot of traffic from this keyword. Is my listing really optimized for this keyword?”

Maybe people make their listing with the assumption that, “Hey, this is the primary keyword I’ve done some searching on,” there’s no 100% accurate in terms of estimated search volume, or rather, there’s no official Amazon search volume like there is with Google where you have the Google Keyword Planner.

Maybe you’ve done some research and you think that this is your primary keyword, but then you start running PPC traffic, and all of a sudden, it seems like something different is your primary keyword.

So, that’s an interesting point that you make there in terms of maybe being able to shift your listing to better target that keyword if that’s where you’re getting a lot of traffic or having some success.

Ty Roney: Yeah. And I think the same thing goes for when you initially—my whole PPC strategy is I’m realizing that the more and more that I do, it’s all about—I don’t try and guess what the best thing is going to be, what the best terms are.

Obviously, you put in as many basic or seed keyword or whatever into different pieces of software and see what comes out of it. But in all honesty, I just dump everything into my campaigns to start with because I’m constantly surprised at what ends up getting clicks and sales. So, it’s not making any of those assumptions beforehand, but letting the data tell you what’s happening.

You can make tweaks to your listing and see how that affects sales, but the interesting thing is the PPC data, that’s really real, real data that comes from Amazon that says, “Hey, here are these keywords. Here are these impressions that you’re getting from this keywords.” And then, you can start to really make decisions based on that.

Chris Guthrie: Yeah, that’s interesting. I think especially just from what you just said then (and then previously, you’ve already touched a little bit on what you think about it in general), if you have a new clients that comes to you, usually, it’s obviously because they don’t have the time to do the pay-per-click or they know that someone else could do it better than them.

What do you do as you walk through those steps? Maybe those are steps that people that are listening can apply to their own business. And obviously, if they just say, “Hey, I want to have someone help me out,” then maybe they can reach out to you after they listen to this.

Ty Roney: Yeah, sure. I mean, the very first step that we do, number one, it’s learning about the product. We learn about your product. We look at competitive listings and try and see and learn the industry, maybe work with you to get some really good insights into industry terms and lingo.

Then obviously, we just use all sorts of different pieces of software from the Azon Keyword Generator, Google Keyword Planner, Merchant Words. I’ve used AMZShark. I mean, there’s a ton, right?

I just tended to use them all, and then throw a bunch of the data in there. Our approach is really that wide net approach.

We start by creating an auto-campaign, just set it up and let it go, and then a few manual campaigns based on how many keywords we get.

And the hardest part is, really, that first week, you don’t even touch it unless there’s some blatantly obvious things that need to change. But my whole theory is in the beginning, you want to just gather information, cast your wide net, and see what rises up to the top.

The nice thing about Amazon, the advertising campaigns, it automatically filters out irrelevant keywords for you. If they’re irrelevant, you’re not going to show up. Or if they do get impressions and clicks, and they don’t get any sales, well the data tells you that too, right?

But that first month is a lot of data-gathering. At least when I run my own campaigns, I really don’t worry about what my ACoS is in that first month overly. I’m just trying to find a lot of information and get enough data to make important decisions.

And then, once month two comes around, that’s when I have a chance to really start to trim things down because I feel like I have enough relevant information to make really good decisions. And then, by month three, it’s a lot more maintenance, making small tweaks here and there on an ongoing basis.

But I guess that first month is pretty critical and gathering that information. And the hardest decision to make is, “Okay, how much data do I need to make an effective decision.”

And so, one question I get a lot is, “Well, how many clicks before I should just pause the keyword?” And that one’s always a tough one to answer because it really depends on how aggressive you want to be.

One way to look at it is just to say, “Well, if my next click was a purchase, would that generate the AcoS I’m looking for” or if it was a purchase, “What would my conversion rate be on my listing? Am I happy with that conversion rate?”

And so those are a couple of different ways to look at it as well. And a lot of it is based on what your goals are and how aggressive you want to be.

Chris Guthrie: Yeah, that’s great. And so, during that initial stage where you’re just running as many keywords as you can, “casting a wide net” as you mentioned, how much are you trying to spend? Is it sort of a function of the total sales of that client or that you perhaps have for that individual product or for that overall business before deciding what to spend?

I’m assuming that it’s going to vary based on each seller, but I wonder if you have some scientific formula or just some type of reason you have behind what you end up spending.

Ty Roney: No. Initially, the initial budget, the daily budgets that we set, in a way, they’re a little arbitrary. And that’s what we try and tell people. We’ll set an initial budget just based on where your comfort level is. And then, we’ll see what the campaign starts to do. And then, the budget is whatever.

I personally don’t like to focus so much on, “Okay, this is my actual budget,” but obviously, in time, focusing on, “Well, is my money being spent the way that I want it to be? And is my ACoS, my advertising cost of the sale, is that where I want it to be? And if so, I’m happy to have a huge budget.”

But getting started, with somebody with one product, to just say $20 a day or something, you can start off with and see what starts to happen. And with your initial bid, your default cost-per-click bid, that’s also a function of how aggressive and how quick you want to be. But I like going a little more aggressive route and saying, “Well, let me start off with…”

Well, it also helps if you know your category a little bit. A dollar a click might be really aggressive for certain categories, but not aggressive at all for others.

Some people, we end up ranging between ¢50 or a dollar (that’s our default bid). And then, we just take a look at it that first week and see what happens and start adjusting from there. I always like to tell our clients that there’s no magic number beforehand. The real value in the service is making those changes based on good information I think.

Chris Guthrie: That’s good. That’s great. And I wanted to shift a bit of focus now. I wanted to go back to the fact that you’re working with clients, you do full-service management, and more recently, you started doing just specifically the PPC side of it.

But I kind of assume that with the amount of clients you have, you’re going to have to have multiple employees that are helping you out, and presumably, various systems for helping to do various tasks within any seller’s business.

So, I’m assuming you have systems in place. But then, I’m wondering if there are any specific systems on different aspects of selling on Amazon that people that are listening that maybe are overwhelmed or they’re doing a lot of stuff themselves, they should start documenting, that have resulted in the biggest wins in terms of time being freed up or just general streamlining of a business.

Ty Roney: Yeah, yeah. That’s something I’ve learned a lot about in the last year, just the value of checklists and processes. And yeah, we do have a team. We have a team. There’s about 12 of us on the team now right here in Utah that help to manage and launch people’s products and accounts.

And so, as far as the processes go, I think it is really nice to have that daily checklist. So, we have daily checklists, weekly checklists, and then monthly checklists. And then, beyond that, we have these questions that we try and ask ourselves to just try and see what we can do to drive success.

From an operational point, the checklists are really straightforward and really easy, right? It’s okay. And it also helps you. If you just have the checklists, it also helps you to be a little bit more effective with your time. You don’t just log in to Seller Central just to log in—it can be addicting—or checking your app just to check it.

So, at least for what we do, we just say, “Okay, when it comes to…”—and this is what I do for my own products too. I just say, “Well, first thing in the morning, I have my little checklist of things to go through.” And then, I’m not going to look at my sales throughout the day. What am I going to do? I’m not going to change things from one day to the next because I sold three less today than I did yesterday.

Chris Guthrie: You’re going to wish for the sales, and they’re going to come.

Ty Roney: Yeah, you get caught in that trap. So yeah, the daily checklist is like boom, boom, boom, respond to buyer messages, is the account performance okay, are my ad campaigns running, does anything seem out of the ordinary there. And then, what did I sell yesterday? What was the breakdown of units sold? Does everything seem to be okay there?

So, you have those kind of checklists there. And then, on a weekly basis, we look at, “Okay, how are my inventory levels? Have I removed as much negative feedback as Amazon…”—it’s pretty much a standard. If you’re using FBA, you can get most of your negative feedback removed. So, it’s doing some of those little things and making sure that if there’s negative customer reviews, that you’re looking at those and seeing what you want to do about that.

And then, obviously, more on the question basis, that’s the trickier part. We also have a very formulated launch process where we’ll sit down and have a strategy session to determine how we’re going to launch a new product for a new client that comes to us.

We have a full-on process. And it’s basically a checklist of larger-scale tasks that we need to do to launch this person’s product. And it’s just all into a system.

And obviously, the way that we approach that system or that process varies greatly depending on the type of product that it is. But overall, the standard system is the same.

And then, ongoing, the hardest part is to really standardize and figure out a way to continue to increase your sales. That’s what everybody wants. So, on the one hand, you make sure that all your operations are taken care of, so you don’t have any operational hiccups. And on the other, you need to be focusing on, “Okay, what is it that we need to do to drive sales and increase sales over time and rank better?”

So, revisiting those questions of “Should I consider running a giveaway? Should I consider trying to get some more reviews on here? Do I need to update my follow-up messages, make that more customized? Is there something else I could provide that’s valuable that might help with my marketing? My PPC campaigns, do they seem like they’re under-performing just on general? Should I try and look for more keywords to add to those?”

So, really, you have those checklists from an operational standpoint. But then when it comes to trying to market and increase the sales of your products, I think it’s really in the value of asking yourself the right questions, so that you can try and test and tweak and be flexible to see what you can do to change?

Chris Guthrie: That’s great. And I think that especially if you’re listening right now and you don’t have checklists or systems that you have in place for your business, then a lot of what you just shared, that’s a great starting point for coming up with your own checklists.

I think that’s a good point too. It’s easy to pick on people that are—especially if you’re just first getting started, it’s easy to think, “Oh, man! I really want to see how my sales are” and then check multiple times throughout the day. But every time you do that, it’s just a waste of time. You just want to check to make sure there wasn’t anything off in terms of your Amazon account. So, that’s great. I think it’s great feedback for people.

We’re pretty much at the end of our time. But what I think I would ask as a final thing since you see so many people’s accounts is are there any major mistakes that sellers are making that you’re seeing when they come to you and to start to work with you.

So, maybe if there’s kind of like a rapid fire, “Here’s some stuff that we see a lot of…” and then that will wrap us up.

Ty Roney: Yeah! Well, the biggest mistake I would say is a “me too” product. There’s literally no differentiation. That’s really hard for us to do much with to be honest. Unless you’re willing to just go crazy and out-spend and get a really tiny margin and your product is literally the exact same as the next guys and the other 50 in the first few pages. That’s the challenge.

So, I guess the biggest thing is really the idea. And this question, I try and revisit a lot. It’s the question of “Why on earth should somebody buy your product instead of the other ten that they’re going to see.”

When people are searching on Amazon, Amazon is like the world of convenience. It’s so easy to scroll down past anybody’s. Your product is literally like—I don’t even know how much effort somebody puts in to go from one product to the next. It’s a tiny, little scroll of your finger and barely any movement of your eye to go from one listing to the next when you search for a product.

And so, you really need to focus on that main, core idea of “Why would somebody buy yours instead of the other ones? And are you displaying things in such a way that there is a reason for them to purchase?” And hopefully, that reason is something other than price. Maybe that’s designed—whatever it is, whatever kind of way you’re differentiating.

For me, that’s the biggest thing, number one. And then, just the other thing is being willing to invest. Spend the money to get to where you want to go. Look at it from a business standpoint and realize that, you know what, there are big, big companies out there that they will lose money for months and even years on end to get to their end goal to find that path to profitability.

It shouldn't be too much to ask. If you really want to test things right, put a lot of money into it in the first few months to see if you can get to where you want to go. Be willing to do that to give yourself the best shot.

And always remembering that any time we launch a new product, it’s always an experiment and it’s fun. So, enjoy it. It’s no big deal if your first one doesn’t work. Try it again.

Chris Guthrie: I love it! Thanks, Ty. This is a great episode. I think that people have a lot of things to take away from this. I appreciate you coming on to share your expertise. Thank you so much.

Ty Roney: Yeah, thanks for having me.

Chris Guthrie: Alright, that was the episode with Ty Roney, you can go straight to Elemerce.com to check out his company if you need help with the Amazon side of your ecommerce business. That’s what they specialize in. So, you can go there to find out more information.

And you can also check the show notes link by going to Sellercast.com/32. Thank you so much for tuning in and we’ll see you in the next episode.